CAF approves a new financial instrument to promote climate and social action in Mexico.

The Board of Directors of CAF -development bank of Latin America and the Caribbean- approved an innovative financing tool that links the financial conditions of the loan to the achievement of climate and social performance goals, which rewards the country's ambition and compliance with its climate change and gender commitments to encourage sustainable development.

Mexico is the first CAF member country to be granted this new modality through a USD 300 million loan for the 'Program to boost the sustainable finance strategy of the Government of the United Mexican States', structured together with the Ministry of Finance and Public Credit, through a Comprehensive Loan Linked to Climate and Social Objectives (PIVOCS).

The overall objective of the Program is to promote integral sustainability in the public agenda in Mexico, through the development of sustainable financial markets and the mobilization of resources towards climate change mitigation and adaptation initiatives, as well as to prioritize gender equality.

"CAF's mission is to promote sustainable development and regional integration, so we are very pleased to offer innovative financial instruments that allow us to improve the quality of life of Mexicans. Through this new PIVOCS modality, we seek to reduce financing costs if climate and social goals are met. This way we improve the country's finances and also promote a comprehensive development agenda with gender equity," said Sergio Diaz-Granados, CAF's executive president.

This Program contributes to the fulfillment of SDG 1: end poverty in all its forms worldwide; SDG 5: achieve gender equality and empower all women and girls; SDG 12: responsible production and consumption, SDG 13: take urgent action to combat climate change and its impacts; and SDG 17: revitalize the global partnership for sustainable development. In addition, this operation is aligned with CAF's corporate strategy and its goal to be the green bank for sustainable and inclusive growth in Latin America and the Caribbean.